Climate & Carbon Management

Chipbond's climate risk identification and assessment are conducted by the Sustainability Development Division, which convenes relevant departments under the Risk Management Team. By collecting information on policy regulations, market trends, internal objectives, and historical records of disasters at the facilities, both internal and external issues are organized to create a list of climate change risk topics.Then,the climate scenarios are established to analyze the potential risks using the risk identification process. The identified risks with moderate to high levels are subject to qualitative or quantitative analysis to assess their potential financial impact. Based on the "impact/dependency level" and "likelihood/time of occurrence," a climate change risk matrix is developed to complete the assessment and analysis of materiality.For climate risks that are deemed significant, after evaluating existing climate adaptation measures, new response actions and adaptation strategies are proposed to address any identified gaps. This process aims to facilitate continuous improvement in managing and mitigating climate risks.

 (1) Transition Risk：

The company refers to the IEA WEO 2023 report and sets the future climate environment as "global temperature increase of 1.5°C", and takes "Taiwan 2050 Net Zero Emissions and Strategy" and "Climate Change Response Act" into scenario considerations and assessment. The possible impact of each risk event under future climate scenarios.

(2) Physical Risk：

 In order to cope with the most serious climate disaster that may occur in the future, refer to the AR6 assessment report SSP5-8.5 extremely high carbon emission scenario released by the "Intergovernmental Panel on Climate Change (IPCC)", and the national disaster potential maps and other information published by the Disaster Prevention and Protection Technology Center identify and evaluate whether each of the company's plants will face related disasters caused by "flooding", "drought" and "heatwaves" under future climate scenarios.

This assessment focused on 5 major climate risks out of the 18 identified risks. The transformation risks include "carbon fee imposition, "low-carbon technology transformation", "increased climate-related information disclosure requirements", and "customer requirements for the use of renewable energy". The physical risk is "damage to buildings and facilities due to typhoons, strong winds and heavy rains". From these risks, we have identified opportunities stemming from climate change and developed adaptation strategies and goals. The objective is to mitigate the potential negative impacts of climate change on the company's operations.